On Wall Street, stock prices fell for the second consecutive day on Tuesday, as statements from Fed officials introduced uncertainty regarding when the central American bank will begin to reduce stimulus measures.
The Dow Jones weakened by 93 points, or 0.60 percent, to 15,518 points, while the S&P 500 slipped 0.57 percent to 1,697 points, and the Nasdaq index fell 0.74 percent to 3,665 points.
The decline in stock prices for the second day in a row is a result of a statement by Charles Evans, president of the Chicago Fed branch, that the central bank will likely begin to reduce stimulus monetary programs later this year, possibly as early as September, depending on the economic situation.
Dallas Fed President Richard Fisher stated that he supports a reduction in stimulus in September, provided that economic data does not worsen.
This has caused uncertainty among investors as the $85 billion monthly purchase programs for government and mortgage bonds have long supported the rise in stock prices. Investors fear that a reduction in these programs would lead the market to lose strong support.
“The market remains confused about the reduction of stimulus. It is still unclear when this will happen, so there is currently really no reason for stock prices to rise,” says Ken Polcari, director at O’Neil Securities.
